1. 1 (Static versus flexible budget variances) Answer all questions posed by Case ATC 8-1. a) Did Atlantic increase unit sales by cutting prices or by using some other strategy? No, it did not increase its sales by cutting the prices; this is because the budgeted price is lower than the actual sales. • Budgeted sales $33,000,000 / 150,000 units = $220/unit • The actual sales price is $35,520,000/160,000 units = $222/unit. Although there is an increase in sale, this increase can be attributed to other factors like advertising. b) Is Mr. Ludwig correct in his conclusion that something is wrong with the company's performance evaluation process? If so, what do you suggest be done to improve the system? Yes, He was correct in his conclusion that …show more content…
Thus, the price determination that is in direct proportion to the number of goods purchased would give an estimation of revenue to be realized. Performance-Based budgeting is the one used by the administrators to have a more cost-effective and aggressive budgeting outlays. Price of the goods and services to be offered and volumes of the same rights to be sold are directly proportional, and that is why it is crucial to have the price rate, and volume efficiency checked when practicing performance evaluation of employees in meeting the budgeted …show more content…
When comparing the quantitative and qualitative factors, the former goes through some activities while the latter considers focus and observation. Some of the qualitative considerations that help in employee performance evaluation are customer feedback, employee attitude, and quality of employee performance. In customer feedback, the employers get recommendations from the customers. Employers understand the performance of the organization through the interactions between their employees and clients to their organizations (Eisner, 2017). Also, employers get to know how the image of the company is upheld. The attitude of the employee is the next qualitative consideration in determining the performance evaluation of an employee. In addition to the view, there are loyalty and behavior of the employees. How the employees work well amongst them determines the performance of the organization: poor employee relations lead to declined performance, and reasonable employee relation leads to increased production. Also, employers would know if the employees are engaged in their work and how they consider their daily business performance or not. Through this act, the employer can pluck out unnecessary employees from the